The latest ban on liquor sales during the state of restraint is a major setback for the wine industry, which is already under great pressure and facing job losses, says the industry organization Vinpro.
On Monday, Agri SA also called for the intelligent management of liquor sales, “rather than a draconian ban”, and demanded, among other things, that e-commerce and limited volumes of sales be allowed, and that the curfew rule be brought forward on weekends.
This follows after Pres. Cyril Ramaphosa announced Sunday night a ban on the immediate sale, supply and distribution of alcohol in force.
Ramaphosa said it was imperative that clinics and hospitals not be overloaded with alcohol-related injuries and emergencies while the country reached the peak of Covid-19 infections.
“There is now clear evidence that the re-sale of liquor sales has led to considerable pressure on hospitals, including trauma and emergency units, due to road accidents, violence and other incidents.”
An evening clock rule from 21:00 to 04:00 is also in effect.
Western Cape Prime Minister Alan Winde says a long-term approach to behavioral change is needed to reduce the damage from alcohol abuse and that a ban can only help in the short term.
“It is a blunt mechanism that will negatively impact the Western Cape’s economy and agricultural sector and lead to job losses across the province. It will also drive sales underground, with less control by the liquor authority.
“To put it simply, it can help in the short term, but the problem is not going to go away and a long-term ban is not feasible.”
Winde said in a statement that there had been a marked decrease in the number of murders and hospitalizations for trauma in the Western Cape when liquor sales were initially banned during the restriction. It also rose immediately when sales were allowed again and put additional pressure on hospitals.
According to Winde, the link between alcohol and violence is well-known and the ban can have an immediate effect on hospitals’ capacity if there is a decrease in homicides, sexual violence, assault and road accidents.
However, the provincial government supports “smart interventions” that highlight a change in behavior, his statement says.
Agri SA says thousands of jobs are in jeopardy due to the ban on liquor sales.
“The South African wine industry contributed R49 billion to the economy in 2019 and in the process created 290 000 direct and indirect jobs. About 40 000 people work on wine farms and in wine cellars. ”
According to Agri SA, the industry also contributed R7.5 billion to excise tax and VAT last year.
“It is South Africa’s second largest agricultural export sector after citrus, earning more than R9 billion in foreign revenue annually. R7 billion of this amount is generated by bottled exports and R2 billion by bulk wine exports. ”
A “total collapse of the industry” can be prevented by the intelligent management and implementation of best practices, says Agri SA in a statement.
These include allowing e-commerce, restricting sales volumes, advancing the weekend curfew rule and enforcing stricter penalties for drunk driving, arranging drinking parties and domestic violence.
“There is no justification for the total ban on alcohol sales. Nor for the inconsistent handling and bias towards certain sectors. “
Agri SA says this bias is reflected in the concessions made to the taxi industry, such as transporting people at full capacity.
“By allowing this, it is clear that the government is afraid of the taxi industry and has succumbed to pressure. This makes a farce of pres. Ramaphosa and the government’s concern over the deadly effects of the Covid-19 pandemic. ”
Vinpro says the decision to suspend liquor sales is a “devastating setback” for the South African wine industry after it has already suffered huge financial and job losses due to the previous ban.
“Despite ongoing discussions with the Department of Trade, Industry and Competition this past month, the industry received no warning about the current ban, and no opportunity for interaction with the national coronavirus command center was given to us. The immediate logistical problems that this poses for suppliers, distributors and retailers were also not considered. ”
According to Vinpro, it is already estimated that the country’s wine industry, which employs about 300,000 people, could lose up to 18,000 jobs.
In addition, about 80 wine businesses and 350 wine grape producers could close within the next year due to the previous five-week ban on exports and the nine-week ban on domestic wine sales.
The wine industry also lost about R3 billion in direct revenue during this time, according to Vinpro’s statement.
“While wine exports may continue, the immediate enforcement of the domestic sales ban will also have unforeseen consequences, including further job losses throughout the value chain, as well as endangering the livelihoods of thousands. The significant number of retailers, wine grape producers and wineries are hit the hardest. ”
Vinpro says the government must also now take up its task of enforcing the regulations, including law enforcement on the smuggling trade in liquor.
Agri Western Cape also doubts whether the government realizes “what enormous damage” the decision on the ban on the value chain as a whole will have.
“The agricultural industry was not known or consulted in the decision and the impact does not stop at the farm gate or at the retailer,” says Jannie Strydom, CEO.
“There are also practical implications, such as what will become of the 2021 harvest if the 2020 harvest is still in the cellars. The entire spirits industry, whose origins lie in agriculture, is adversely affected by the lifting of sales. ”
According to the regulations published in the Government Gazette on Sunday , the transport of liquor is prohibited, except for disinfectants and detergents, export purposes or storage.
No special liquor licenses or event licenses may be considered for approval during the state of restraint.
The Minister of Transport must also, after consultation with the Cabinet, issue regulations for the transport and storage of liquor.
• Read the latest regulations here.